To be honest, no matter how good or visionary one idea is, when it comes to practicality in Malaysia, I will always have my doubts and reservation. For example, the Vision 2020 with flying cars and high income country has been proven failed. Then, COVID-19 hits.
COVID-19 has hasten the progress of e-commerce and accelerate the adoption of cashless transactions in Malaysia. Due to the need of social distancing, physical shopping and cash handling are deem hazardous. Even requesting medication process in my hospital has moved online for processing and record tracking. Based on my experience in dealing with online medication requests, cashless transaction can be smooth and effortless for those who know it, but it can also be a bane for those who are less informed.
On top of education, there are other factors that are holding the adoption of cashless transactions back.
While monetary transaction requires verification from at least both (sometimes more) parties, accessible and speedy internet is one of the most important component that links the “internet-of-things’. However, I still personally find a number of blind spots for 4G-internet in city areas, where it left me no choice but to opt for cash payments.
Though Malaysian government has announced a 5G development blueprint, 4G coverage in the country is still less than desirable. During this COVID-19 season, plenty of students need to ‘hike’ or to ‘climb’ onto higher grounds to submit assignments and to sit for tests. In a capitalist society, installation of new facilities will not convene when there is little to no financial motivation (profitability or subsidy). Whenever viral news (like above) burns, then only government agencies and telecommunication companies will look into the issues or leverage its publicity potential. For the greater good and advancement of the nation, such practice is not healthy and should be discouraged.
I am glad that Malaysian government is pushing for national coverage of internet with Communications & Multimedia Blueprint 2018 – 2025 and MyDigital — the Malaysia Digital Economy Blueprint, which encourages the building of networking infrastructure and recognising internet access as an amenity.
Any creative ideas to fill the gap? Please leave your suggestion in the comment below.
Safety and Privacy
I would consider this being the early days of change, where infrastructure and system are still being drawn and built. In order to use electronic payments, we have to trust vendors and third party platform developers with our private information, including credit card information and addresses. However, based on my experience, my information has certainly turned up in some unexpected places, including international scam organisations. Worse still, there is very little I can do to the culprits, due to the lack of regulations and will from the authorities. I can only opt to self-educating in the shop that some day, I can do something.
In general, Malaysians have negligible awareness in personal data security. We might unknowingly surrender our identifiable information at security posts, random discount card vendors or fake websites. Those personal information can easily being used by scammers for social engineering. As a result, scams become part of our daily news, aside from nasty political dramas. Those scams might further reduce the trust of Malaysians on electronic transactions, despite multiple safeguards are in place.
Prone to Errors
This is an extension from the above point. Given all human creations are imperfect and prone to errors, any glitches, outages and innocent mistakes might stop you from accessing the virtual money when you need it. Likewise, merchants are unable to receive any payments when network is down or system malfunction. I had experience in multiple occasions where the vendor software is outdated, or my mobile network is unstable, forces me to use cash instead.
Sometimes, people neglected in updating to the latest software. Sometimes, people forgot to log out in public facilities. Outdated software and hardware are vulnerable for exploitation, and given Malaysians low awareness of cybersecurity, I am feeling worried for our chances in this arm race.
Not B40 Friendly
Malaysian economic system has some fundamental and systemic flaws. Living with us is a large population of B40 income group and stateless people who has minimal income to afford a ‘fancy’ device, receive minimal education to understand the operation and do not have a valid identity to open a bank account to be included into the financial system. The stateless people who have to perform informal economy might not have the mean to get paid if everything is to go cashless. Bear in mind that going cashless also requires a subscription to mobile data plan that will incur extra costs.
Malaysians may be able to assist B40s in transitioning, but statelessness is a hot potato that most politicians are unwilling to touch, so the fate of this group looks bleak in the foreseeable future. Low income and statelessness are two groups of people that fully cashless economy will kill.
I love holding a big pile of cash and I bet you do as well. Yet when it comes to spending, if transactions are done ‘cashlessly’ and effortlessly, you will not feel the ‘pain’ of every ringgit given out. With cold hard cash you can feel the thickness and weight of your wallet, but mere numbers take away the sensation and attachment to your hard earned money. We can minimise the number and ‘risk’ of spending big money, as we are unlikely to carry crates of cash around to settle the bills. Therefore managing spending is going to be harder and different for this generation amidst the easy swipes and taps.
Not Disaster Proof
A cashless economic system would realistically die when a disaster hits, especially when large portion of power grid is disrupted. Right before Typhoon No 19 Hagibis hits Japan, advices were given to Japanese to withdraw enough cash in case when banks could not open and/or power facilities affected. Therefore, it is reasonable to think that cash can be a reliable resource for disaster survival.
Given a number of issues might arise from a fully cashless economic system, in turn excluding a large number of Malaysians from the daily economy activities, cash is still going to play a crucial role in Malaysia. I do wish for an idealistic no cash society, but there are some grave issues to settle first, ie income gap and statelessness.
Wish me luck.